This is a Golden Age for health care. But at the same time new treatments and cures are being developed, Americans are properly concerned about costs. How can the health care system continue to innovate while providing value?
|
|
Our NewsletterIssue No. 63: With Fanfare, White House Issues Four Orders on Drug Prices, But What Would They Actually Mean?President Trump on July 24 signed four executive orders intended to “deliver lower prescription drug prices to American patients.” Some of the orders resurrect ideas that have been discussed for years. Some could have beneficial effects on Americans’ out-of-pocket costs and on their health. Others are likely to be harmful or impossible to implement. STAT News called the orders “a last-ditch effort by the White House to cut drug costs before the November election.” And, according to Reuters, “experts say they are unlikely to take effect in the near term and in some cases lack specifics.” Regulatory orders can take months, even years, to implement. For example, the White House first announced a rebate reform order two years ago, placed it in the Federal Register eight months later, then rescinded it five months after that and is now bringing it back. Still, the newly announced orders are worth examining in detail. Even if they do not affect policies this year, some may be brought back in the future, perhaps by a Biden Administration. Democrats could find it easier to pass legislation similar to Speaker Nancy Pelosi’s H.R. 3, the Lower Drug Costs Now Act, by pointing to the Trump Administration’s own price-control proposals. President Trump has already achieved a major (but rarely recognized) success in constraining drug prices by removing regulatory barriers that harmed competition. The Administration could continue on that path by adopting a variety of policies that would quickly reduce out-of-pocket expenses, especially for seniors. We will mention some at the end of this newsletter. For now, let’s turn to the July 24 orders. The three most important concern requirements that: 1) prices for certain Medicare Part B drugs not exceed what any other wealthy country pays, 2) pharmacy benefit managers (PBMs) pass on to consumers the rebates that the PBMs demand from drug manufacturers, and 3) the Department of Health and Human Services (HHS) ease the way for states to import drugs from Canada, where they are generally cheaper. All three, in slightly different forms, have long histories. Let’s take them in turn: Read More Here. |
What Others Are Saying"The anger directed at the pharmaceutical and biotech industries overall is misdirected. The single biggest driving force for increased health-care spending in the U.S. is the rising cost of labor, not drugs." "Even if pharmaceutical spending were rising as a share of total health care spending, but that rise was due to pharmaceutical investments driving down expenditures in other health care areas (e.g. a reduced need for more expensive surgeries), then it would still be inaccurate to argue that pharmaceutical spending is driving overall health care inflation." |
Newsletter Archive
Cost-of-Health-Care News (CHCN) was launched on November 30, 2016, with the aim of providing news and analysis regarding a critical public-policy concern: the costs and pricing of health care. CHCN is published by EAH Strategies, headquartered in Grand Rapids, Mich. CHCN is supported by Pfizer.